This article was first published on the Huffington Post on June 24, 2010 12:04 PM.

The dire straits of the middle class of America has made it near impossible for our politicians to keep up the pretense that our current government truly works for the “people.” Between the multiple overt and secretive bailouts, the massive bonuses and the circular use of our tax money to lobby for these continued handouts, you can no longer hide from the evidence.

When Senator Durbin said “The banks… frankly own this place,” you realize it was not in jest.

Couple this with recent protections handed by the Supreme Court to corporations to directly influence elections and it can make things seem hopeless for those not on Wall Street or their chosen politicians. Favored CEOs and now even foreign countries get all the printed money they need, leaving us paying both our bills and theirs.

If you are one of them, chances are you didn’t do anything wrong. Almost all of you were not subprime borrowers or speculators, but merely people buying a house that they thought they could afford at the time. You were just unlucky in that you bought a house during a time when an outdated Wall Street and their complicit politicians decided to use housing to regain the income they lost due to the Schwabs and Etrades of the internet age.

Now you are struggling to make the same payments on this mortgage on your now overpriced home even in light of a crashing economy and massive deflation, all while the government does everything in its power to help Wall St. keep the bonuses coming.

Well, it is becoming time to take matters into your own hands… I suggest that you call your lender and tell them if they don’t lower you mortgage by at least 20%, you are walking away. And if they don’t agree, you need to consider walking away.

That is because you probably are a good person. But your mortgage is a business deal, and it is not immoral to walk away from a business deal unless you went in to the deal with the intention of defaulting.

As part of the deal for your house, your mortgage holder gets interest payments from you and they also use the note to your house for their capital reserves. In return, they take the risk of a foreclosure. In many states, you paid extra to have a non-recourse loan where the lender just gets the house back if you stop paying — your interest rate would’ve been much lower if you were held personally liable like a student loan. But if you still feel bad, then donate the money saved to charity instead of to their bonuses. And when someone tries telling you why it is so wrong, here are some answers:

– Yes, it might seem selfish, but you are actually going to help fix our country the right way, through the use of pure capitalism. There are 3 parties involved in your mortgage — the mortgage holders, the servicing bank and you. You probably want to stay in your house. Most of the people who actually own your mortgage also want you to stay in your house, preferring a mortgage reduction that you keep paying instead of the total loss of a foreclosure. But the major banks (BofA, Wells Fargo, JP Morgan, Citi, etc.) that underwrite and service the loans don’t care about either of you. They (with the aid of their government) just care about hiding their true financial condition for long as possible so they can continue to bonus themselves outrageously. The credible threat of you walking away from your mortgage en masse is the only market-based solution that will force these banks to work with the mortgage holders on your behalf.

– No, you will not “hurt” your neighbors — certainly not near the scale of the banksters. Chances are someone just as nice will you will move in and (unlike you) pay a fair, non-inflated price for the house. Encourage your neighbors to fight back against the banks and ask for their own mortgage reductions as well.

– Yes, it might make getting a loan harder for everyone. Considering the spate 0% down NINJA loans over the past decade, that probably isn’t a bad thing.

– Yes, it might hurt your credit. But with time, people bounce back from having foreclosures on their record. Search online and then talk to a lawyer about the repercussions, which vary by state.

– No, the banks won’t necessarily pass the losses on to customers. They already make a lot of money. If costs are passed on to every consumer without banks competing on price, that’s a sign of illegal collusion or a monopoly. Let’s fix that instead of just letting banks ruin our lives. They might, however, not all make $145 billion in bonuses next year doing something fundamentally so easy that it is an unpaid job in Monopoly.

Instead of claw backs for the past theft and strong financial reform for the future, they choose to cover-up the gross misuse of our tax money, making our country worse by helping the criminals on the backs of the most honest.

But thankfully, in this country we still have the tools to fight back and regain our country. Our vote, our voice, our laws and what we choose to do with every penny we have that doesn’t go to taxes are the benefits of our hard-fought freedom, and in this battle we must use them all to fight back. It’s time for the citizens to once again own this place.

Dylan, the problem of underwater homes is MUCH more widespread than officially reported. In May of 09, Zillow reported that 21.8% of loans were underwater, http://silverpros.blogspot.com/2009/05/20-of-home…. Equities have gone down since as prices have plummeted. I agree wholeheartedly with your recommendation to stop paying,that is what I advise my clients to do also. It is truly the only leverage we have with the banks. If the situation was reversed, the banks would cut our throats without a blink and the government would support them.

Amen Bill……..Its no secret about all the fraud going on with these big banks. Its in the news every day and it sure looks like the government isnt doing much about it. Nobody goes to jail so these Banks keep on lying and producing false documents or cant find documents to prove they own the property. It goes on and on and its way to much for the avg person to comprehend. OMG….MERS they decide to duplicate a public registrar…haha. (Google John Obrien Essex County Ma.) The arrogance of these greedy people. What would happen to us if we decided to start a business that sells drivers licenses ?t. Ya know, Im babbling here and not a real smart guy but I know enough make myself ready when the time comes. I hired a lawyer and Ive stopped paying…F em!!! If they wont work with you STOP PAYING!!!

I agree. The majority of people asking for help WANT to keep their homes and aren't asking for a hand out. They're asking for a little help with the monthly payments. If the banks don't want to help (I've been trying to re-modify for over 2 years now) then just stop paying, save that money and hire a lawyer who "gets it".

Doesn't this completely ignore the harm that people who walk away from their mortgages do when the Feds have to bail out the banks with taxpayer money? There's a bumper sticker out there that says "Honk If I'm Paying Your Mortgage." It's true. When foreclosures happen in such a large scale, it isn't just a simple, isolated business deal between the lender and the homeowner.

It could be if the Government wasn't owned by the Banks, et al. We don't have to jump in and spend taxpayer money to keep them large and powerful and their execs rich and happy.
The government could break them up into smaller parts, often the parts they assembled to get so large, and let them survive by honest (!!!) business practices.

Leave it to Msnbc to teach people how to be irresponsible and unaccountable for their finances. I think the majority of this country did not agree with the banks getting a bailout, but reguardless, that should not be an excuse to walk out on a contract when you buy something. This kind of mentality only contributes to the problem itself. I would love nothing more than to sell my house but that’s life, as long as I can make my payment, I choose to continue to be personally accountable for the decision that made and pay my payments. The auto companies got a bailout too, does that mean people should stop making their car payments? Their is a such thing as bankruptcy for those who really can’t pay, and I hear it’s a pretty sweet deal that months after you file you can start racking up credit card debt. What a great, honest, moral way to live. Just because our government is corrupt shouldn’t be an excuse for the people to be. This entitlement mentality is truly the real battle in the years ahead,

If you believe the government is corrupt and the people should go along with this I am guessing you are either a banker or a wallstreet welfare recipient. What a shame that the people of this country cannot stand up to their government as they do in other parts of the world. The Supreme Court with its Bush Administration appointees gave our political decisions to big business with their "corporations are people to" garbage, why did the people of this country not protest? When Bush & Company decided to give all of the tax payers money to the Banks, the people of this country should have protested in the streets. It appears the USA could take a lesson from the Egypt, Jordan and Yemin right about now. It would appear that Bush and Company gave this country away while everyone was working 2 jobs to try to keep food on their table. Until the people unify and take back their government this is no longer a country for the people and by the people.

amen. I'm a first time home owner bought litterally at the peak. and now triing to find some light. and banks are no help of course. but now that my eyes have been being opened to the rules, regulations, laws, protocal, And my absolute favorite, the thats the way it is garbage. I ltteraly just got off the phone with the bank thought pretty much what you said about takeing this country back. I looked at my wife and said I want to start a revolt like egypt. get this country how it was intended to be, for the people, not about the money they can produce. then I hopped on the internet and first site, someone speaking my mind already. I felt so releaved. its not just me, this government is the most hipocritical sons a b's.

If my daughters starving and steal a can of formula so she can eat and i get caught. I'm arrested charged and convicted fined plus court cost ect, because it's the law and government and state needs thir money. but the government can take my, and everyone elses money and stick it in thier pocket, bank accounts, Their family and friends pockets and accounts, buy marble counter tops and a dimond toilet becouse they are busness necessitys.slap on the rist. swept under the rug. or forgave and forgotten. I Know not everything can be equal or even, but what ever happend to fair.

Makes better working environment. please, I use portalets at work and I can work just fine, i think they could to. and if they can't then well suck it up and deal like the other 90% of america that has no choice and found them selfs stuck in the crappy craper. If they do get caught, oops my bad,

It is obvious you are not into hard times. I am sooo very happy for you. But for the rest of us which there are many, I think this was an incredible article. I have lost all of my properties trying to do the right thing and paying my mortgages. I always put at least 40% down on my properties. I also went through my entire savings paying mortgages that the banks woild not short sale, modify or help you in any way. It is disgusting to see these banks bonus their CEO's and employees. I use to work for a very large bank and was laid off and left with nothing. I am not going to judge you on your reaction on labeling people as irresponsible to walk away from their home. I was the same way until I was left with nothing. I pray you do not experience what many Americans have and are forced to walk away and even better were smart enough to walk away. I truly do not see this as an entitlement mentallity I see it as a buisness decision that I should have made a long time ago.

THE BANKS' FRAUD VOIDED THE CONTRACT. They skirted the strong laws on real estate transfers that made US real estate such an attractive investment to foreigners and us.
THE WALL ST BANKS PLANNED THE REAL ESTATE BUBBLE. Borrowers now must pay $500k for a $300k house.
THE BANKS' GREED KILLED THE ECONOMY. Borrowers lost their property and their jobs.
THE BANKS GREED DESTROYED THE TRUST IN GOVERNMENT AND THEMSELVES.
We cannot overlook the banksters' criminal acts against us. If we try, nothing will ever work for us again. What don't you understand about this?

You need to do a lot of reading. The Original Lender had been paid off 3 days after you signed your Promissory Note (which was your credit slip – money, negotiable instrument). they had never credited you for it nor gave you the receipt. The current lenders are really servicers pretending to be collecting for the Owner of the Note. They are stealing from the Investors and the Borrowers. Wake UP!

what if you can,t make your payment. when I signed my loan for 117,000 my house was worth 130,000, with needing alot of work. several thousands later, alot of time and effort, I'm told my house is only worth 80,000 but I still need to pay the full 117,000 for an 80,000 dollar house. If my value is going to drop so should my payment. or interest rate drop have more applied to the morgage and less to the banks greedy endless pockets. as it should the same if it goes back up return prices. Economy drops so does work so does pay rate with pay cuts if you want to keep your job but the banks wont work with you when they all get hefty bonuses. If a bank wants to raise rates the can do so as they please more or less. and they do, and always areason, so why can't they drop or lower it to. Arent we all living the american dream

Dylan, please shed some light on the $1.5 TRILLION naked short that JP Morgan has on silver.
This WILL be paid by taxpayers when they cant make their call.
Sorry to get off topic but I would really like to hear your opinion about it.

Sounds like "K" – 'doth protest too much'!!! Read carefully, all the signs of his/her statement point sharply toward this partisan conservative (tea-partier??) being closely aligned with bankers, lien-holders, et al. I'm just sayin'…… The only tactic that (may) have a negative affect on the "Banksters" (bottom-line) is for struggling mortgage-holders to do the, "I'm mad as hell and I'm not going to take it anymore", thing.

I was approved for the HAMP loan, but was told by CitiMortgage they needed $9,959.72 by a certain date in order to process the paperwork . I was told that interest and fees could not be placed on the back end of the loan because of Texas law. No loan officer I talked with had ever heard of the law mentioned. It took approximately nine months of frustration, anxiety, and stress. The idea that one is having a problem making payments, and to say that I had been approved but I needed to pay $9959.72 for the modification to be processed is beyond belief. Consequently, I had to burden my children for the money which was the most humilating experience of my life because as a parent, it is my responsibility. As a 74 year old veteran I didn't have many options. If this is the way HAMP was intended to help homeowners, it has to be among one of the biggest scams ever.. I have been complaining to all of the agencies that are suppose to help, but most don't even respond.

Yes they do! The next generation will be full of congressional/big banks DNA because they are all sleeping together. Congress is too afraid to take the side of the people and risk not getting campaign money. The biggest proponents of the free market are the ones manipulating it the most, the only people that are brainwashed into believing this are those who get stuck paying the bills. The bailing out of the banks has proven to be the biggest scam in history and there are still people saying that "your mortgage contract with the bank is non negotiable because at one time it was a reasonable deal"

That is the most simple minded thing I have ever heard. So I take it these are the people that have never asked for a raise when they produced more at work? I suppose they have also turned down a raise when it was given to them before their contract expired. Oh no thank I signed the deal for less money so I won't accept the bonus. I don't think so.
The analogy with auto companies is ridiculous unless of course you took a 30 year note on your prius. Don't be so simple about it. To be continued

There is a major difference between having a 30 year house payment anchor and a 3 or 5 year auto payment. You can also add that the bankers and TBTF banks are the ones who caused the meltdown. It wasn't the homeowners; even the first foreclosures were not the cause. The system had been set up with CDS and securitization in a manner that would implode the housing market with a typical number of defaults.
Anyone who can not see that setting up a model that has to have perfection or it will bring down the country is in need of an education. If you are willing to think the bankers were stupid enough to no understand the chances of obtaining perfection then you can keep believing it is your moral obligation to not re negotiate your mortgage that is 250,000 in the hole. Everyone can make their own choices, but don't put you twisted thinking onto everyone else who see the stupidity in what you are claiming.

If you are not a banker then you must be in congress or the white house because there is no logical reason to give the banks a free pass. They melted down the economy with their "creativity". Wall Street couldn't leave home owners to have one nest egg that was free from the manipulations and abuses of traders. Even if you don't have a home, you should be able to see through the bank fraudulent activity.

Thank you all for shedding some light into this issue. For two years I tried to modify my loan but because I was diligently making my payments every month I was denied. I worked for a major mortgage bank, Countrywide, and when they went belly up I Iost my job along with thousands of others. The reason why I tried to modify. Long story short, I stopped making my payment 6 months ago and since then have gotten many letters from my lender making offers for help. I am no longer interested and have decided to save money to move out (walk away). I no longer believe in our government, banks, etc… they have not done anything to help. I only work partime and I mentioned this clearly in my hardship letter. I do not feel ashamed, I believe I made the right decision of not throwing my money away and at this point do not care of any repercussions that may come. The article made me reaffirm that what I am doing is right. Thank you Dylan

in europe you buy a house for many generations, here in ussa the illegal fed collapses real estate every 18 years, so bankers get richer, we absolutely need to get rid of fed, everyone should live in their house for free, get rid of usury, see muslim no usury mortgages, enough is enough, wake up and smell the american dream turned to nightmere thanks to the greediest rockefeller parasites …

Wow. I wish I had looked at this site a year ago when I was trying to do the right thing, taking money (and a hard hit taxwise) from my retirement because I was optimistic I was going to becoame gainfully employed. As retirement continued to dwindle, job search getting tougher by the day, living in a house in the middle of a remodel(lost my job during remodel), caring for a service member's child while he is overseas. Esther, you are saying everything I have been dealing with. I had a great credit score and thought dipping in to my retirement would help while I went through modification. Every time I sent something in the story would change, didn't make enough money, I needed to do something else, I complied with every request. The mortgage got sold in the process. LBPS has lost documents, there is a different person handling my call every time I contact them, no consistency in service. I have received calls from the current mortgage holder's staff who refused to identify themselves or the company they are with. I thought this was not legal. I am now in forebearance, near nervous exhaustion, from trying to do the right thing.

Yes the banks were/are greedy and "creative". Yes they have the government in thier back pocket. No we should not have bailed them out. For free market to work there needs to be a winner and a looser. When the looser gets proped up by government, free market automatically fails. However we the people also share part of the blame. Many people bought a $500,000 dollar house when they knew they could only afford $300,000. They got short term APRs and belived they could refi once they built equity. It worked great as long the bubble was expanding. Banks were loaning to anyone with a pulse and, people were flipping houses like pancakes. everyone was making money.

I thought about buying large myself, but I didn't, because I knew it was a gamble, and I wasn't willing to gamble with my familys future just because the bank said it was ok. I have a 30yr fixed. I have refinanced 3 times over the past 10 years, taken out over $60,000 in equity and now I have a 4.5 intrest rate and still around $40,000 in equity. So I really can't understand what the hell you all thought you were doing signing those mortgages that were obviously beyond your means. I don't care what the bank told you at the time, you should have known better, but you wanted to ride the gravy train. Now the gravy train broke down and you all want off. Well too damn bad. You bought an over priced one way ticket that said right on the front "no refunds". This is really all part of the larger problem of no one taking responsibility for thier actions. Not people, banks, corporations, government, no one. There is verry little honor and integrity left in this country, and zero accountability. It's just sad really.

interesting comments. You seem to be ignoring the other issue of the mortgage/housing problem–that many hardworking, responsible people DID buy within their means, they just expected that the product they bought would at least HOLD its value! We could have accepted a small hit, but not like this. I agree that some people did get in over their heads. Many of us have separate circumstances, however, which you can only know by listening to their stories. Real estate (viable, maintained real estate) does NOT typically depreciate, at any percentage, for as long as I have been alive. If we could have seen this coming, HELLO, we would not have entered into these bogus business decisions in the first place. There was no gravy train for many of us, just an expectation. Now many have lost a substantial portion of their home's value. I personally lost 50% of my home's value AND put down a substantial amount of money for it (all lost). I contracted for a 30-year loan on new construction and was living in my "on the market" home during said construction. My plan was to re-fi directly after my other home sold, which it did. Then, all of a sudden, the market crash. Our builder bailed and sold the remaining subdivision to another builder, who was building smaller, cheaper homes, which was the second way my home was devalued. OK, THAT wasn't discussed when I signed that mortgage agreement!! The problem is, no one will let me do that re-fi now. And I am expected to CONTINUE to pay the inflated interest rate on that inflated mortgage, despite interest rates having been substantially reduced over the past couple of years. I tried to re-negotiate my mortgage just for a lower interest rate. Banks WILL NOT negotiate even the most simple and logical solutions. How is THAT fair? Someone has stolen MY (and others) MONEY and is getting away with it. To say we have to suck it up and pay this thing out while no one answers to it is insanity. All I ever asked for was a lower interest rate and a shorter term. I never asked for a reduction of the mortgage. And no one will play. I can pay more as I go, but certainly can't pay it all up front. And yes, I agree there is zero accountability. I don't WANT to walk away from my house. You can say it's morally, ethically, legally wrong. But so is what has been done to ME and millions of others. It is UNPRECEDENTED. I don't know who is getting the spoils of my labor in the end–but apparently it won't be me if I stay in this insane agreement that doesn't apply to the current situation or make any sense any longer.

Flush the banksters out. Specifically those who bundled mortgage backed securities. Implement a "Quiet Title Action." It basically calls out anybody that may have a legal claim towards a property (check local laws). It forces a clear trail of property rights/ownership to appear before the courts and if none appears (time limited), the title is clear to original owner on deed.

Esther, you should try and save your home. Don't let the banks have their cake and eat it too! Stay put in your home and find a lawyer who "gets it" to defend you. Save your money. The banks make more profit from foreclosing on your property. They will give you the run around as they have with everyone who's tried to re-modify in order to foreclose. Research online on ways to defend yourself. Read articles and comments from this site: http://www.livinglies.com. I hope that helps.